Forfeiture of Shares
This query is : Resolved
CA Sunita Patil
(Querist)
14 February 2010
if Company forfieted shares wht will be tax treament in hand of company. send me case law to support argument that said receipts is capital receipts there for question of charging tax not applied.
14 February 2010
Dear Sunita
It's A capital gains.
Please follow below link for this :
https://164.100.80.145:8080/dspace/bitstream/123456789/10655/1/ITA219-03-05-02-2008.pdf
It's A capital gains.
Please follow below link for this :
https://164.100.80.145:8080/dspace/bitstream/123456789/10655/1/ITA219-03-05-02-2008.pdf
CA Sunita Patil
(Querist)
14 February 2010
I am asking in hand of compnay who forfieted the shars. shall it taxable in hands of company.
CA Sunita Patil
(Querist)
14 February 2010
r u online
14 February 2010
yes I am online. Yes it's taxable in the hands of company same given in case law.
CA Sunita Patil
(Querist)
14 February 2010
page give me page no, i m not able to get it
CA Sunita Patil
(Querist)
14 February 2010
ABC Ltd. issue share warrant of Rs. 1cr to Mr. X, he required to made paymnet in 2 intallment. 1st paid by him on 1/4/2008 and 2nd due on 01/4/2009 and said is not paid by him there for BOD of ABC ltd forfieted. Now my question is that Rs. .5 cr forfieted by ABC ltd. ,is liable to tax in hands of ABC Ltd.?
CA Sunita Patil
(Querist)
14 February 2010
pl provide me reply, in my opinion its capital Receipts, as Act not specifically made it taxable is not taxable
CA Sunita Patil
(Querist)
14 February 2010
pl provide me reply, in my opinion its capital Receipts, as Act not specifically made it taxable is not taxable
14 February 2010
Dear Sunita
Now it’s possible to tell you exact tax law. There is lot of controversy in your case but in Maharashtra in "Income-tax Vs. Deepak Fertilizers and Petrochemicals Corporation Ltd (304ITR AT 367)" case, Mumbai bench of ITAT held that this receipt is capital receipts hence not liable to tax in the hands of company. But you in direct tax code 2009 this forfeiture is chargeable to tax under other source. For you reference follow link for details https://www.taxmann.com/BlogDetails.aspx?bid=20.
No I thought you got satisfactory explanation.
I will provide my cell number but please before that mail me @ shri.kar4@gmail.com so that I can give you my number through mail.
Now it’s possible to tell you exact tax law. There is lot of controversy in your case but in Maharashtra in "Income-tax Vs. Deepak Fertilizers and Petrochemicals Corporation Ltd (304ITR AT 367)" case, Mumbai bench of ITAT held that this receipt is capital receipts hence not liable to tax in the hands of company. But you in direct tax code 2009 this forfeiture is chargeable to tax under other source. For you reference follow link for details https://www.taxmann.com/BlogDetails.aspx?bid=20.
No I thought you got satisfactory explanation.
I will provide my cell number but please before that mail me @ shri.kar4@gmail.com so that I can give you my number through mail.
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